In a mixed contract for goods and services, the predominant purpose test under the UCC determines whether the contract is governed by the UCC. Which statement is correct?

• A. If the predominant purpose is the sale of goods, the contract is a goods contract
• B. If services predominate, it is a services contract
• C. The contract cannot be formed if services are included
• D. The UCC does not apply to mixed contracts

Answer: (A)

The key idea is determining which law governs a mixed contract by looking at the predominant purpose of the agreement. When a contract for goods and services has goods as the main goal, the transaction is governed by the UCC because its primary focus is the sale or transfer of goods. That’s why the statement that if the predominant purpose is the sale of goods, the contract is a goods contract is the correct one: the UCC applies to the core element of the deal, which is the goods component.

If services predominate, the governing law would be common law rather than the UCC, so that alternative would be incorrect. The claim that a contract cannot be formed if services are included is also incorrect—contracts can be formed with mixed goods and services under either framework, depending on which predominates. Finally, saying the UCC does not apply to mixed contracts is false; the UCC does apply when goods predominate, and mixed contracts are evaluated to see which law governs based on the dominant purpose.